Civil administrative office Bank branch office

Profit 80 Expected profits

Reduction if GDP incr. is low 10 Probability of winning
Win probability with office 0.2
Win probability without office 0.01

Economic housing Tax break on profits by conservati

same
Profit (only if liberals win) 34
Win probability with office 0.9
Win probability without office 0.01

Early construction Construct now

Winning party Cons. Lib. Con
GDP status GDP hi GDP lo GDP hi GDP lo GDP hi
Late construction decision Construct

Outcome I II III IV V
Construction cost 31 31 31 31 30

Civil administration office 16 14 16 14 0.8

Bank branch office 10 10 10 10 10
Economic housing 0 0 30.6 30.6 0

Net profits -5 -7 25.6 23.6 -19.2

Final payoffs (incl. tax breaks) -5 -7 25.6 23.6 -19.2

Probability index 0.2 0.2 0.3 0.3 0.2

-1 -1.4 7.68 7.08 -3.84

12.36 -7.877

Construct ofice now Conservati High GDP

12.36 -6 -5
40% 50%
Low GDP
-7
 50%

Liberal WinHigh GDP

24.6 25.6
60% 50%
Low GDP
23.6
50%

12.36 Don’t Construct Office n Conservati High GDP Construct

11.325 11.2875 11.34 -19.2
40% 50% Don't Concstruct
11.34
Low GDP Construct
11.235 -19.3
50% Don't Concstruct
11.235
Liberal WinHigh GDP Construct
11.35 11.4 11.4
60% 50% Ddon't
11.34
Low GDP Construct
11.3 11.3
50% Don't
11.04
 ch office
profits 30
y of winning 0.333333

on profits by conservatives 5%

Don’t construct now

Cons. Lib.
GDP hi GDP lo GDP hi GDP lo What are the orders in which variuos d
Don’t Construct Don’t Construct Don’t Construct Don’t
OFFICE now?????
VI VII VIII IX X XI XII ELECTION Decision
0 30 0 30 0 30 0 GDP
Office ???
0.8 0.7 0.7 0.8 0.8 0.7 0.7
10 10 10 10 10 10 10
0 0 0 0.34 0.34 0.34 0.34

10.8 -19.3 10.7 -18.86 11.14 -18.96 11.04

11.34 -19.3 11.235 -18.86 11.14 -18.96 11.04

0.2 0.2 0.2 0.3 0.3 0.3 0.3

2.268 -3.86 2.247 -5.658 3.342 -5.688 3.312 Office

construct
later -19.046

don’t
construct
at all 11.169

In case thereis an expert who

Expeert is always going to be right is an assumption
here the office decision is going tohappen after the expert decision….......
With xpertthe office deciison now?? Gets
L is liberals actually win
l is liberals predicted to win by our expert, and when i say expert is right
`=> probability L giver l is equal to 1
We know probability that L = 0.6
Probability l = ?
the orders in which variuos decisions are taken?

Chance node
Chance node
Decision nopde
 Construct ofice now Conservative winning High GDP
12.36 -6 -5
40% 50%
Low GDP
-7
50%

Liberal Win High GDP

24.6 25.6
60% 50%
Low GDP
23.6
50%

12.36 Don’t Construct Office nowConservative win High GDP Construct

11.325 11.2875 11.34 -19.2
40% 50% Don't Concstruct
11.34
Low GDP Construct
11.235 -19.3
50% Don't Construct
11.235
Liberal Wins High GDP Construct
11.35 11.4 11.4
60% 50% Don't
11.34
Low GDP Construct
11.3 11.3
50% Don't
11.04
 Construct ofice now
0.119999999999998

11.3

Predicts conservative is winnigDon’t Construct Office now

11.3

Analyst
#VALUE!

Construct ofice now

18.48
 18.48

Predicts Liberals wins

0.666666666666667 Don’t Construct Office now
11.3375
Conservative winning High GDP
-6 -5
80% 50%
Low GDP
-7
50%

Liberal Win High GDP

24.6 25.6
20% 50%
Low GDP
23.6
50%

Conservative win High GDP Construct

11.2875 11.34 -19.2
80% 50% Don't Concstruct
11.34
Low GDP Construct
11.235 -19.3
50% Don't Construct
11.235
Liberal Wins High GDP Construct
11.35 11.4 11.4
20% 50% Don't
11.34
Low GDP Construct
11.3 11.3
50% Don't
11.04

Conservative winning High GDP

-6 -5
20% 50%
Low GDP
-7
50%
Liberal Win High GDP
24.6 25.6
80% 50%
Low GDP
23.6
50%

Conservative win High GDP Construct

11.2875 11.34 -19.2
20% 50% Don't Concstruct
11.34
Low GDP Construct
11.235 -19.3
50% Don't Construct
11.235
Liberal Wins High GDP Construct
11.35 11.4 11.4
80% 50% Don't
11.34
Low GDP Construct
11.3 11.3
50% Don't
11.04